JP Morgan Public Finance Transportation Utility Conference

Transcription

1 JP Morgan Public Finance Transportation Utility Conference April 18-19, 2018 Presented by: Brenden Morgan Sr. Manager of Debt & Investments

2 Table of Contents I. Overview of the Region and RTD II. Updates III. Financial Activity IV. Debt Portfolio

3 I. Overview of the Region and RTD

4 Denver Regional Profile Denver MSA Population (millions) ¹ Denver MSA Unemployment Rate² Denver MSA vs. US Per Capita Income ($ in 000 s)¹ Employment Diversity (as of 2016)¹ Other Services 4% Leisure & Hospitality 11% Education & Health Services 13% Government 14% Natural Resources & Construction 6% Manufacturing 5% Wholesale & Retail Trade 15% Financial Activities Professional & Business Services 7% 18% Transp., Warehousing & Utilities 4% Information 3% Source: ¹Metro Denver Economic Development Corporation ²Bureau of Labor Statistics 4

5 Overview of RTD Created in 1969 by the Colorado General Assembly and mandated to operate an integrated public transportation system in the Denver Metro region: 2,340 square miles service area Serves 40 cities and towns and 8 counties Service area population over 3.1 million (approximately 55 percent of Colorado s total population) Governed by an elected 15 member Board of Directors, with one member from each of the 15 districts comprising RTD s geographic area System currently includes (as of March 30, 2018): 1,027 active buses (437 leased to private carriers) 398 Paratransit vans (Access-a-Ride and Call-n- Ride), all leased to private carriers 172 Light-rail vehicles (201 by 12/31/18) serving 53 stations 66 Commuter rail vehicles serving 9 stations 83 Park-n-Ride locations (32,048 parking spaces) 87.8 million annual revenue service boardings and 99.3 million annual total boardings in ,863 RTD employees and 1,608 private carrier employees 5

6 FasTrack Overview West Light Rail Line - began operations in 2013 Denver Union Station: Light Rail relocation - completed 2011 Amtrak - began operations in 2014 Underground Bus Facility - began operations in 2014 Historic Station - open to public in 2014 U.S. 36 BRT - began operations in 2016 Eagle P3 Project fully funded: Commuter Rail Maintenance Facility completed 2014 University of Colorado A Line to Denver International Airport began operations in 2016 B line to Westminster began operations in 2016 G line to Golden anticipated to open in 2018 I-225 Light Rail Line (R Line) began operations in 2017 N Line to Thornton funded to 124 th Avenue - Scheduled opening under review Southeast Light Rail Extension scheduled to open in 2019 Central Light Rail Extension deferred; no funding identified before 2040 Southwest Light Rail Extension deferred; no funding identified before 2040 Northwest Commuter Rail Line End of B Line to Longmont deferred; no funding identified before 2040 North Metro Extension 124 th Avenue to 162 nd Avenue deferred; no funding identified before

7 Transformation of RTD Service Since FasTracks Election Percentage Change Fixed Route Buses 1,074 1, % Light Rail Vehicles % Commuter Rail Vehicles % Total Service Miles Traveled 49,053,000 44,368, % Total Annual Boardings 82,978,959 99,369, % Park-n-Ride Spaces 20,849 32, % RTD Service Population* 2,545,000 2,920, % *2016 data The reduction in fixed route buses and total service miles traveled is a product of the expansion of light rail and commuter rail services

8 II. Updates

9 EAGLE P3 University of Colorado A Line and B Line Operational On time service rate: Approx. 95% 2017 Ridership: 7,106,000 Ridership exceeding expectations Colorado Public Utilities Commission (CPUC) will begin drafting final orders for removing flaggers on a crossing-by-crossing basis Gold Line Construction completed in December 2016 Revenue testing is ongoing Revenue service is pending CPUC final orders, which are anticipated to be similar to the 5-year FRA operational waiver; order expected to be handed down in the near future Dispute resolution Ongoing - Non-binding recommendation expected in coming months Tolling agreement executed; stipulates no declaration of default by RTD until the earlier of 30 days after dispute resolution panel recommendation or 7/31/18 if the 6/2/18 revenue service date is not met by DTP

10 Collective Bargaining Agreement The five year CBA between RTD and the ATU expired February, After a significant negotiation period, RTD and the ATU agreed to the following highlights: RTD continues to make a 13% contribution to the union pension (employee contributes 5%) and adds a $6.2 million lump sum annual payment Each occupational group receives an 8% wage increase in 2018 and 3% in 2019 and 2020 Daily assignments of extra board work cannot have a spread greater than 13 consecutive hours (bus and rail) The latest a day operator s shift can end is 8:30 pm and night operator s shift can start is 9:30 am (bus and rail)

11 III. Financial Activity

12 Major Sources of Revenue (2017) 0.6% Sales and Use Tax (Base System) $358.9 million Approved by voters in 1973 as a 0.5% tax to support the issuance of bonds to develop a public-multi-model mass transportation system; raised to 0.6% in 1983 Pledged first for payment of Senior Lien Bonds (Lien is closed no new debt except for refunding for savings) See Slide 12 for flow of funds 0.4% Sales and Use Tax (FasTracks) $239.3 million Approved by voters in 2004 to fund the construction and operation of FasTracks. See Slide 12 for flow of funds Farebox Revenues (system wide) $140.2 million Generated from bus, paratransit, light rail, and commuter rail operations Capital Grants $86.4 million From federal, state, and local sources Operating Grant Revenue $80.4 million From federal, state, and local sources Includes FTA Section 5307 formula funds and Section 5309 Fixed Guideway Modernization Other Sources $24.9 million Includes advertising, investment income, BAB subsidy funds, rental income, parking income, 3 rd party contributions and other sources Operating Grant 9% Capital Grant 9% Farebox 15% Other Sources 3% FasTracks Sales Tax 26% Base System Sales Tax 38% Source: RTD 2017 Unaudited Financials 12

13 Sales Tax Revenue Collections by Industry (2017) 40,000 Top 15 Sales and Use Tax Revenue Collections by Industry 35,000 30,000 25,000 20,000 15,000 10,000 5,000 - Source: Colorado Department of Revenue

14 History of Sales Tax Revenue Collections Election Approving FasTracks 0.4% Sales & Use Tax $ in Millions % Sales and Use Tax 1.0% Sales and Use Tax Source: RTD 2017 Unaudited Financials 14

15 Annual Revenue Ridership and Fare Revenue Annual Revenue Ridership Annual Fare Revenue (in thousands) ($ in millions) For the past five years, RTD s farebox recovery ratio is approximately 23-24% Source: RTD unaudited 2017 Financial Statements 15

16 System-Wide Operating Expenses in 2017 Expenses by Department Planning 0.5% General Counsel 2.2% Safety, Security and Asset Management 3.2% Rail Operations 11.2% Non-Departmental 3.7% Board Office 0.1% Expenses by Type Finance and Administration 5.3% Executive Office 0.7% Depreciation 29.9% Bus Operations 34.3% Capital Programs and Facilities 7.3% Depreciation 29.9% Salaries & Wages 20.8% Fringe Benefits 11.0% Communications 1.5% Miscellaneous 0.5% Leases & Rentals 0.3% Purchased Transportation* 19.1% Services 9.3% Materials & Supplies 5.4% Utilities 2.0% Insurance 1.6% *RTD contracts out approx. 55% of its bus services Source: RTD 2017 Unaudited Financial Statements 16

17 IV. Debt Portfolio

18 Credit Structure Sales Tax Bonds Base System Sales Tax Bonds (0.6%) Closed lein, Final Maturity in 2024 FasTracks Sales Tax Bonds (0.4%) Base Sales Tax (0.6%) FasTracks Sales Tax (0.4%) Farebox and Other Revenues Service Payment Eagle P3 Project Two Components: TABOR Portion Gross revenue pledge of Base System Sales Tax and FasTracks Sales Tax after payment of Base System Sales Tax Bonds, FasTracks Sales Tax Bonds, and TIFIA loan Appropriated Portion Parity with all other operating expenses and Certificates of Participation Certificates of Participation ( COPs ) & Capital Leases Annual appropriation secured by leased assets Base System COPs may not be paid from 0.4% FasTracks Sales Tax Operations and Maintenance (System-Wide) Base System operations may not be subsidized by 0.4% FasTracks Sales Tax FasTracks operations secured by all available revenues Base Sales Tax Bonds FasTracks Sales Tax Bonds (1) & Parity obligations TABOR Portion of Service Payment RTD Appropriated Expenses Capital Investments Administration Operations & Maintenance Non-TABOR Portion of Service Payment COPs & Capital Leases O&M (1) Includes TIFIA Loan which is a Parity Obligation. 18

19 Debt Outstanding Moody's S&P Fitch Senior Bonds Aa1 AAA AA Stable Stable Stable FasTracks & Parity Bonds Aa2 AA+ AA Certificates of Participation and Lease Purchase Agreements Stable Stable Stable Aa3 Stable A Stable AA- Stable $3,000,000,000 $2,500,000,000 Debt Outstanding $2,608,491,682 $2,000,000,000 $1,500,000,000 $1,176,397,512 $1,000,000,000 $500,000,000 $- $96,695,000 Senior Bonds FasTracks & Parity Obligations Certificates of Participation 19

20 Outstanding Sales Tax Obligations As of December 31, 2017 Sales Tax Bonds (0.6% Base Sales Tax) Sales Tax Revenue Refunding Bonds, Series 2007A 69,825,000 Sales Tax Revenue Refunding Bonds, Series 2013A 26,870,000 Total $ 96,695,000 FasTracks Bonds (0.4% Sales Tax) Sales Tax Refunding Bonds (FasTracks Project), Series 2007A 220,480,000 Sales Tax Revenue Bonds (FasTracks Project), Series 2010A 79,140,000 Sales Tax Revenue Bonds (FasTracks Project), Taxable Series 2010B 300,000,000 Sales Tax Revenue Bonds (FasTracks Project), Series 2012A 474,935,000 Sales Tax Revenue Refunding Bonds (FasTracks Project), Series 2013A 204,820,000 Sales Tax Revenue Bonds (FasTracks Project), Series 2016A 194,965,000 Sales Tax Revenue Bonds (FasTracks Project), Series 2017A 82,895,000 Sales Tax Revenue Refunding Bonds (FasTracks Project), Series 2017B 119,465,000 Total $ 1,676,700,000 TIFIA Loan and Other Parity Obligations Eagle P3 TIFIA Loan* $ 341,878,142 TABOR Portion of the Service Payment TABOR Portion of the Service Payment (Eagle P3 Project) $ 589,913,540 Sales Tax Bonds are special limited obligations of RTD payable from and secured by a 1 st lien on the revenues received by RTD from its 0.6% sales tax. FasTracks Bonds are special limited obligations of RTD payable from and secured by a (i) 1 st lien on the revenues received by RTD from its 0.4% sales tax and (ii) 2 nd lien on the revenues received by RTD from its 0.6% sales tax. No Sales Tax Obligations bear a variable rate of interest or are subject to acceleration. 20

21 Sales Tax Debt Service Coverage Base Sales Tax Bonds Pledged Sales Total Year and Use Tax Revenues Debt Service Coverage ,152 24, ,833 28, ,911 28, ,159 28, ,912 28, FasTracks Bonds Pledged Sales Total Year and Use Tax Revenues Debt Service Coverage ,485 61, ,953 69, ,749 69, ,832 69, ,562 79,

22 Outstanding Appropriation Obligations Certificates of Participation and Lease Purchase Agreements Certificates of Participation Taxable Refunding, Series 2007A 6,255,000 Certificates of Participation, Series 2010A 108,655,000 Certificates of Participation, Taxable Series 2010B 100,000,000 Certificates of Participation, Series 2013A 175,965,000 Certificates of Participation, Series 2014A 440,915,000 Certificates of Participation, Series 2015A 128,915,000 Lease Purchase Agreement, Series ,552,512 Lease Purchase Agreement, Series ,140,000 Total $ 1,176,397,512 Certificates of Participation and Lease Purchase Agreements are secured by the (i) leased property and (ii) lease payments by RTD pursuant to their lease with RTD Asset Acquisition Authority for the leased asset, and payable from such lease payments. No Certificates of Participation bear a variable rate of interest or are subject to acceleration. For the adopted budget plan, RTD will not issue any new COP s or Lease Purchase Agreements and will instead fund capital replacements from reserves. 22

23 Question & Answer